UK - Strong new business growth in its LDI business has helped boost profits for Legal & General Investment Management (LGIM), which has just unveiled its 2009 results.
Increased derisking activity by pension fund clients pushed LDI assets under management to £29.9bn (€33.5bn), a 31% increase from the previous year-end.
As a whole, LGIM's pre-tax operating profit for the year to 31 December 2009 was £172m, unchanged from 2008.
Gross new business inflows for the year were £31.5bn, 2% higher than in 2008, while assets under management at 31 December 2009 were at a record £315.1bn, a 19% rise over the previous year.
LGIM says that although market volatility affected revenues in early 2009, second-half profits were 32% higher than in the first six months of the year, as markets rallied and gross inflows increased.
Over the 12 months, the average ad valorem fee margin increased from 9.7 basis points to 9.8 basis points, thanks to a change in business mix.
Other areas performing strongly were active fixed income assets, which surged by 26% to £56.3bn by 31 December 2009, and LGIM's index business, which the company says delivered excellent growth.
Peter Chambers, chief executive, LGIM, said: "While 2009 was a very challenging year for the economy as a whole, I am pleased to say that LGIM thrived. The outlook remains challenging, but I am confident that LGIM is very well positioned to continue to build on the successes of the past and that 2010 will be another strong year."
The company also claimed significant success from its US office, where initial efforts to market both active fixed income and LDI products have already won new clients.
LGIM said it continues to support the growth of its passive investment management business, while diversifying its revenue streams through the delivery of superior active fixed income performance and innovative LDI solutions. In 2009, 24% of new business inflows came from non-index fund clients, up from 14% in 2008.
LGIM has continued to diversify into non-UK markets with new mandate wins from Europe, the Gulf and America.